The world is short of 8.7 million tons of rice, Vietnamese rice exports are benefiting

The world is short of 8.7 million tons of rice in 2023

According to a forecast by the macroeconomic research organization Fitch Solutions of Fitch Group, the global rice market is forecast to fall into the most severe shortage in two decades in 2023.

Fitch Solutions says a shortage of this magnitude in one of the world's most cultivated grains is expected to affect major rice importing countries. And on a global scale, the most obvious impact of the rice shortage is that rice prices have been and are still at their highest levels in a decade, even though prices will remain anchored around their current highs through 2024. The report of Fitch Solution also forecasts that in 2023, the world will be short of about 8.7 million tons of rice.

Meanwhile, in terms of global rice supply, according to the latest report of the US Department of Agriculture (USDA), global rice production in the 2022-2023 crop year reached 503.96 million tons, down nearly 2%, equivalent to a decrease of nearly 11.4 million tons. In which, production in major exporting countries decreased significantly, including: India from 130.29 million tons to 124 million tons; Pakistan decreased from 9.1 million tons to 6.6 million tons compared with the crop year 2021-2022, this production is forecast to be at the lowest level in recent 4 years.

The price of Vietnamese rice is increasing at a record in the past 2 years

The fear of a global rice shortage has been having positive effects on Vietnam's rice exports. Mr. Do Ha Nam - Vice Chairman of the Vietnam Food Association, Chairman of the Board of Directors of Intimex Group - said: While many export industries such as textiles and garments, seafood, leather and footwear and wood are in a serious decline, rice is in decline. rice is still the bright spot of export activities in the first quarter of 2023. Specifically, rice exports decreased by 19.3% in volume but increased by 30.2% in value over the same period in 2022. And with the world situation continuing to have high demand for food security such as Currently, we forecast that rice prices will continue to remain high.

In fact, at the end of the last trading week, the price of Vietnam's 5% broken rice was offered at $495-500/ton. This is the highest level since April 2021 and is up from $465-470 a week ago.

In the country, according to statistics from the agricultural sector of the Mekong Delta provinces , the purchasing price of rice is also at a high level due to low supply. Specifically, in Hau Giang, the commonly purchased price of IR 50404 rice is 7,300 VND/kg, OM 18 is 7,900 VND/kg, RVT is 8,400 VND/kg; In Can Tho, the price of OM 4218 rice also recorded an increase of VND 100/kg to VND 7,300/kg compared to the previous week, while other varieties remained high such as IR 50404 VND 6,800/kg, Jasmine at VND 7,600/kg …

"From March 2023, the price of rice began to rise, surpassing the peak of 2022 and with this price farmers are very beneficial" - Mr. Bach Ngoc Van - Deputy General Director of Southern Food Corporation - Vinafood 2 reviews.

Prices will continue to rise…

According to Mr. Nguyen Van Thanh - Director of Phuoc Thanh IV Production - Trading Co., Ltd (Vinh Long province), it is forecasted that this year Vietnam will have 2 increases in rice prices (around May and October - November) due to high demand. high import demand.

Mr. Thanh said that importers will increase rice purchases in April 2023. The reason is that the peak of the winter-spring crop has passed, there is not much commodity rice left, and the price of rice will increase. Rice importers will buy in. In addition, the winter-spring crop is the main rice crop of the year for the best rice quality, domestic rice trading companies also take advantage of buying and keeping goods in stock, gradually selling until the summer-autumn crop, even selling until the summer-autumn crop. Autumn Winter. In addition, at the beginning of 2023, most rice exporters have very low inventories, even some companies are almost out of stock. While according to the provisions of Decree 107, each enterprise must keep in stock the amount of rice equivalent to 5% of the total amount of rice exported .

Regarding the purchase of rice, Mr. Bach Ngoc Van - Deputy General Director of Vinafood 2 - said: As the focal point and leader in the industry, Vinafood 2 advocates to continue purchasing rice for farmers. Up to now, Vinafood 2 has purchased about 500,000 tons of rice (equivalent to 1 million tons of rice equivalent) at market prices. "Vinafood 2's policy is to ensure that all rice is sold to farmers at high prices," added Mr. Van.